Refer to the graph above. Suppose that the economy is at an initial equilibrium where the AD₁ and AS₁ curves intersect. If cost-push inflation occurs and the government adopts a "hands-off" policy approach, then in the long run the price level will be at: A) P₁, and output will be at Q₁ B) P₃, and output will be at Q₁ C) P₂, and output will be at Q₂ D) P₃, and output will be at Q₃

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The Answer of Refer to the graph above. Suppose that the economy is at an initial equilibrium where the AD₁ and AS₁ curves intersect. If cost-push inflation occurs and the government adopts a "hands-off" policy approach, then in the long run the price level will be at: A) P₁, and output will be at Q₁ B) P₃, and output will be at Q₁ C) P₂, and output will be at Q₂ D) P₃, and output will be at Q₃

Refer to the Graph Above